Industry Issues
August 1, 2005
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Sabmiller to Acquire Bavaria
SABMiller, based in
London, will take on Colombia’s Grupo Empresarial Bavaria in a merger
worth $7.8 billion. SABMiller will assume a 71.8 percent interest in
Bavaria, and Santo Domingo Group will take a 15.1 percent interest in
SABMiller.
Graham Mackay, president and chief executive officer
at SABMiller said he expects annual cost synergies and operating
improvements to reach $120 million by 2010. Bavaria is the second-largest
brewer in South America, with annual beer volumes of 175 million
hectoliters. Its major brands include Aguila, Cristal, Pilsener and Atlas.
Bavaria’s current holding company will be able
to nominate two directors to the SABMiller board, and Bavaria executive
committee members Alejandro Santo Domingo and Carlos Alejandro Perez will
serve as vice chairmen of a newly created board that will oversee
SABMiller’s operations in Latin America.
“We are particularly proud of the fact that, for
the first time, Colombian interests will have such an important role in a
company the size and magnitude of SABMiller, and that SABMiller will
establish their South American regional headquarters in Bogota,” said
Julio Mario Santo Domingo, chairman of Bavaria, in a statement. BI
CCE says Bravo! to dairy business
Coca-Cola Enterprises and
Bravo! Foods International are negotiating a master distributor agreement
as well as a share purchase plan that would give CCE a controlling interest
in the company that produces Slammers and other dairy beverages. The
agreement would give CCE exclusive distribution rights to Bravo! products
throughout North America as well as Canada, Belgium, France, the United
Kingdom, Luxembourg, Monaco and the Netherlands.
Of the potential deal, Bravo! Chief Executive Officer
Roy Warren said, “A distribution and purchase agreement with one of
the largest distributors in the country is a giant leap forward for Bravo!
as we continue our momentum in retail outlets across the county and abroad.
We look forward to a mutually beneficial relationship with CCE and
substantial growth of Slammers worldwide as a result.” BI
Pernod Ricard, Fortune
complete Allied deal
Pernod Ricard and Fortune
Brands have completed the acquisition of Allied Domecq, making Paris-based
Pernod Ricard the second-largest wine and spirits company in the world, and
the largest outside of the United States.
As a result of the sale, Fortune Brands will pick up
the Courvoisier, Canadian Club, Sauza Tequila and Makers Mark businesses,
pending Federal Trade Commission approval. In the United States, Allied
Domecq initially will operate as a wholly owned subsidiary to allow for the
sale of the brands to Fortune.
“We are confident that Pernod Ricard USA will
continue to be one of the most successful and fastest growing players in
the U.S., with a superior brand portfolio as Pernod Ricard USA continues to
move ahead in the U.S. market, where just five years ago the company was ranked No. 15,” said Michele Bord, president and
chief executive officer of Pernod Ricard USA.
In a separate agreement, Pernod Ricard USA has sold
the Seagram’s Vodka brand to Young’s Holding Inc. to allow it
to focus on the new Stolichnaya brand as its sole U.S. vodka. The brand,
which was introduced in 2002, had sales of 640,000 cases in 2004. BI
Cadbury to sell European beverage business?
Cadbury is said to be
considering a sale of its European soft drink business, according to a
report in London’s The Independent. The company reportedly has asked investment banker Goldman
Sachs to find a buyer for the business, which also includes the Orangina
and Oasis brands, although it chose to not comment on the speculation. BI
PepsiAmericas opens new facility
PepsiAmericas has opened a
new regional distribution center in Pleasant Prairie, Wis. The
90,000-square-foot facility will provide sales and service for the
company’s southeast Wisconsin and northeast Illinois businesses. It
will integrate operations in Kenosha, Wis., and Gurnee, Ill., but is not
expected to affect employees due to its close proximity to both former
locations.
The center includes advanced truck loading equipment,
a fleet maintenance shop, vending machine repair facility and
administrative offices.
“Our current facilities are dated and
don’t allow us sufficient space to operate,” said Region
Manager John Ruffolo. “The new facility will maximize our day-to-day
operations and allow us room to expand.” BI
Ste. Michelle adds Spring Valley business
Ste. Michelle Wine
Estates, Woodinville, Wash., announced it will manage the Spring Valley
Vineyard and acquire the brand from the Derby family of Walla Walla, Wash.
The company says in its short time on the market, the Spring Valley brand
has become a sort of Washington State “cult wine.” All of the
wine is estate-bottled and quantities are limited. Only 900 cases of the
Uriah 2001 and 1,200 cases of the Uriah 2000 Merlot blends were produced.
The lineup also includes Frederick, which is primarily
Cabernet Sauvignon; Nina Lee, a Syrah; and Muleskinner, a Merlot.
“These are some of the most remarkable wines
made anywhere in the world today,” said Ted Baseler, president and
chief executive officer at Ste. Michelle. “We are familiar with the
Spring Valley Vineyard since grapes we purchased from there consistently
make the final blend of Northstar, our acclaimed Walla Walla
Merlot.”
“We chose Ste. Michelle Wine Estates to take on
the vineyards and wines because of their dedication to Washington
wines,” said Dean Derby. “That is why we are pleased to lease
the winery to them as well. They are committed to the highest-quality
wines.” BI
Saint Arnold expands capacity
Following record sales in
2004 and the first half of 2005, Saint Arnold Brewing Co., Houston,
announced plans to add equipment and personnel by a third. The company says
the investment will include a new bright beer tank, extra refrigeration and
a new pair of fermenters, each twice the size of the facility’s
current fermenters. The company also has doubled its staff to keep up with
demand.
“Craft beer’s popularity is continuing to
grow throughout Texas,” said Saint Arnold Founder Brock Wagner.
“This investment will increase capacity to more than 300 barrels per
week.”
Last year, the company grew sales 27 percent, and
Wagner predicts production will reach 12,000 31-gallon barrels in 2005,
which is full capacity for the brewery. The new equipment will increase
capacity to 16,000 barrels per year. BI
go figure
1.5
Billions of dollars in
sales last year through the Pennsylvania Liquor Control Board, an increase
of 7.6 percent. This is the second year of more than 7 percent sales
growth, reports The Philadelphia Inquirer.
8
Percent of Americans who regularly drink green tea,
according to a study by the American Institute for Cancer Research that was
released at the International Research Conference on Food, Nutrition and
Cancer. That makes green tea the least popular category of non-alcohol
beverage in the United States.
10
Percent of dining parties with children under age 13
at tableservice restaurants, according to the National Restaurant
Association’s Tableservice Restaurant
Trends 2005. More than two-thirds of operators
say that is consistent with previous years, but a quarter of operators say
the number of family parties has increased. Reflecting the change, two of
five operators say they have changed food and beverage offerings for
children.
15.6
Billions of dollars earned by the sports nutrition and
weight loss industry in 2004, an increase of 14 percent, according to Nutrition Business Journal. Annual gains of 5 to 7
percent are expected for the next eight years for a total of $22.8 billion
in 2013.
16
Percent decline in sales of traditional British teabag
in England during the past two years, according to Mintel International.
Loose tea sales are down 9 percent as younger people opt for energy drinks,
juice, water, herbal teas and fruity hot drinks, reports The Contra Costa Times.
